UEFA Expanding Champions League? Why It Makes Sense

At the start of every soccer season the objective for each top-tier European teams is to make sure they do enough to secure a place in the following year's UEFA Champions League. Champions League participation brings not only glamor and media attention but also an enhanced revenue stream.

This season the 32 teams that reached the Champions League group stage (8 groups of four teams) plus the 44 other teams that failed to negotiate the qualifying phase can expect to share around $1B.

Distribution is based on performance and an allocation from the TV market pool. The latter basically returns money generated from the sale of TV rights in each market to teams representing that country.

This means that it is not uncommon to find runners-up or losing semi-finalists pocketing more money than the winners. Last season, for example, Manchester United lost in the final to Barcelona but earned $69.7M against the champions $66.8M.

The European Champion Clubs' Cup which the winner receives (Photo credit: Wikipedia)

After last week's games we know that country representation in this season's final four mirrors twelve months ago - Spain with two teams, Germany and England with one each.

While Spain's Real Madrid and Barcelona met at the same stage last season this time the luck of the draw kept them apart. Real Madrid has to play Bayern Munich and Barcelona plays Chelsea.

The prize money will not be finalized until after the final is played at the Allianz Arena in Munich on May 19 but we can come up with a pretty solid estimate of what each team can expect.

The losing semi-finalists can look forward to at least $50M, the runner-up between $60 and $65M and the eventual winner between $65 and $70M.

Over the last 15 years Champions League money has become an imperative for many European clubs rather than a bonus.

With so many clubs sailing very close to a rocky financial shore, a season without the Champions League can quickly lead to a financial wobble or even crisis. The risk is now exacerbated by the implementation of UEFA Financial Fair Play which basically requires each club playing in European competition to operate within the limits of its annual revenue.

But the success of the Champions League has affected more than the clubs.